Boost pours jet fuel on Barr energy ambitions

Boost Drinks was always going to catch the eye of acquisitive soft drinks businesses with cash to splash. Launched back in 2001, the business now boasts a turnover of more than £40m a year.

And that’s without even entering the supermarkets. Instead, Boost has built a booming business in the independent retail channel, with listings in symbol operators, c-stores and forecourts.

“Boost is the only brand that is a top three in three functional drinks categories – energy stimulation, sports drinks and RTD iced coffee,” says Boost Drinks marketing director Adrian Hipkiss, citing IRI data for symbol groups and independent retailers for the year ending 25 December 2022.

The brand’s also done well when compared with rivals across the whole grocery market. Having grown value by 25.8% to £23.7m and units by 39.2%, it’s the fastest-growing energy brand across both measures [NIQ 52 we/e 29 April 2023].

That means its value has jumped ahead of Rockstar, whose sales fell 24% to £17.9m as its strategy shifts following the PepsiCo buyout.

It’s therefore hardly surprising Barr Soft Drinks snapped up Boost Energy for £32m in December. In fact, Barr CEO Roger White said at the time Boost’s strength in the independent channel is what made the company especially attractive.

The deal would create “channel development opportunities and new routes to market” for Boost, he said, noting its fit with Barr’s business model.

“We are very comfortable with that side of the market and see Boost as a natural fit. The business will expand its activity across multiple channels and routes to market, but I don’t think you will see a huge change to that in the short term,” he continued.

Barr is right to tread carefully in terms of developing new channels. A quick rollout into the mults could damage the goodwill cultivated over the past two decades with independents through its focus on that channel.

But the brand’s strength in independent retail isn’t the only draw for Barr. Boost is a business built on a capital-light model that outsourced all manufacturing, warehousing and logistics.

That means there’s potential for Barr to boost margins by bringing some of these functions in house. As a former distributor of Rockstar, Barr certainly has the expertise required.

Likewise, Boost looks a good stablemate for Rubicon Raw, the energy brand Barr already owned when it bought Boost.

Rubicon Raw is going down a different route by catering to a more health-conscious energy consumer via the mults – and it’s proving successful, if its 11.5% increase in value sales to £13m is anything to go by [NIQ 52 w/e 29 April].

So Boost could be just the fuel Barr needs to diversify its presence in the competitive energy fixture.